Election Campaigning in HOAs and Condos – What’s Allowed? – Artilce by BETH A GRIMM, P.L.C.

Article by Beth Grimm, P.L.C. HOA & Condo Attorney

What’s my take on election campaigns in homeowner associations and condo associations? Are there limits and restrictions? Here are some questions from an inquiring mind:

“I’m writing to get your take on a situation at our HOA regarding a pending ballot to update the Governing Docs. It seems that 1363.04 specifically refers to the use of association resources for Board Elections, but makes no references to ballot measures (recalls, doc updates, Board decision reversals). In researching it seems the consensus is this restriction applies to all elections/ballots, what is your take? ”

Here is what 1363.04 says:

“1363.04. CAMPAIGN FUNDING. (Section operative July 1, 2006)

(a) Association funds shall not be used for campaign purposes in connection with any association board election. Funds of the association shall not be used for campaign purposes in connection with any other association election except to the extent necessary to comply with duties of the association imposed by law.

(b) For the purposes of this section “campaign purposes” include, but are not limited to, the following:

(1) Expressly advocating the election or defeat or any candidate that is on the association election ballot.

(2) Including the photograph or prominently featuring the name of any candidate on a communication from the association or its board, excepting the ballot and ballot materials, within 30 days of an election, provided that this is not a campaign purpose if the communication is one for which subdivision (a) of Section 1363.03 requires that equal access be provided to another candidate or advocate.”

My take is this: This sounds fair on its face and should be honored. “The Board” should not advocate for any particular candidate – but individual board members can “politic” so long as they make it clear they are doing so as an owner, not on behalf of the Board. Here is more on the question posed:

“If it does apply to this ballot, what would constitute a ‘campaign’? The association has sent out multiple emails and notices encouraging members to vote – those seems appropriate. However, on three occasions I’m aware of (twice via the monthly invoice and once via a letter mailed to every homeowner) they use the language “Please review the new documents and vote “YES” to increase the Association’s business efficiency and continue to improve our community” This advocacy to members seems to trigger the provisions of 1363.04 where the Board would be required to fund a similar statement from members opposing the ballot. Is that true?”

My comment: As to the question of whether a board can use HOA funds to “advocate for” a proposed amendment to the documents – one of the Board’s obligations is to do what is best for the community and updating the governing documents is just such a thing! To suggest the board must take a neutral or no position on such an important project is ludicrous. The best way to counter any battles over whether this statute is violated in such a campaign is to hold a meeting and allow owners to speak their concerns, and have someone available at the meeting that can address those concerns rationally. The same can be accomplished by presenting a Q and A integrating owner’s questions with knowledgeable responses. Giving someone a soapbox to destroy good intentions of a board is counterproductive. Likewise, boards should at least consider remarks of owners even if derogatory, to determine whether they are credible concerns. My experience is that owners who tend to be overcritical of boards often use this important project as a negative sounding board and often I find the criticisms unwarranted, whether they are thrust at boards I am assisting with the project, or whether the owners come to me with a litany of complaints about a set of documents drafted by an attorney I know to be knowledgeable and credible in this industry.

And there is more to the question posed: “If it does apply to this ballot, what would constitute a ‘campaign’? The association has sent out multiple emails and notices encouraging members to vote – those seems appropriate. However, on three occasions I’m aware of (twice via the monthly invoice and once via a letter mailed to every homeowner) they use the language “Please review the new documents and vote “YES” to increase the Association’s business efficiency and continue to improve our community” This advocacy to members seems to trigger the provisions of 1363.04 where the Board would be required to fund a similar statement from members opposing the ballot. Is that true?”

My comment: The board does not need to “promote” negative statements but trying to hide them does not help much either. That is why I recommend a thoughtful Q and A – to present credible information, including any reasonable counter to an effort to block a restatement project. Outdated documents hamper a board. It is acceptable to stand behind the restatement process. They pay a lot of money to attorneys to draft updated documents and as I said, it is an important project. Letting it fall to complainers is not in my opinion the best course. Considering criticisms and addressing them appropriately is the responsible thing to do.

This reader has more:

“Lastly, in all the correspondence from the Board, in regards to the ballot, it suggests contacting the General Manager with questions and to get more information. The Manager is in support of the ballot and advances that position. Given that the Manager is paid by the Association is there any ‘objective’ requirement in 1363 or elsewhere in regards to elections or ballots?”

More comment by me: It is true that questions are often directed to the manager. The manager is often in the best position to answer the questions as they tend to work with the board and attorney in coming up with beneficial updates to the documents. If a board supports and a manager opposes an update/restatement project, I would be very concerned about letting the manager anywhere near the owners. The manager’s job is to further the policies adopted by the Board.

I know lots of owners complain about their boards. Some complaints are justified, I recognize. I have to say, however, that in my 20 plus years of experience I have seen many more ungrounded, irresponsible, and uneducated complaints about the restatement process from disgruntled or unhappy owners than constructive ones.

– EXTRAS –

Download Secret Ballot Form

Download Secret Ballot Instructions

Download Candidacy Notice

Download Notice of Annual Meeting

– To view original article, click here

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